§1.1 Field of the Invention
The present invention concerns advertisements (“ads”), such as ads served in an online environment. In particular, the present invention concerns techniques that can be used to help simplify the management of ad campaigns where the ad may be served with various documents using various techniques, and where the various documents may have different values per selection (or some other action triggering a charge to the advertiser) and the various techniques may have different values per selection.
§1.2 Background Information
Advertising using traditional media, such as television, radio, newspapers and magazines, is well known. Unfortunately, even when armed with demographic studies and entirely reasonable assumptions about the typical audience of various media outlets, advertisers recognize that much of their ad budget is simply wasted. Moreover, it is very difficult to identify and eliminate such waste.
Recently, advertising over more interactive media has become popular. For example, as the number of people using the Internet has exploded, advertisers have come to appreciate media and services offered over the Internet as a potentially powerful way to advertise.
Interactive advertising provides opportunities for advertisers to target their ads to a receptive audience. That is, targeted ads are more likely to be useful to end users since the ads may be relevant to a need inferred from some user activity (e.g., relevant to a user's search query to a search engine, relevant to content in a document requested by the user, etc.) Query keyword-relevant advertising, such as the AdWords advertising system by Google of Mountain View, Calif., has been used by search engines. Similarly, content-relevant advertising systems have been proposed. For example, U.S. patent application Ser. No. 10/314,427 (incorporated herein by reference and referred to as “the '427 application”) titled “METHODS AND APPARATUS FOR SERVING RELEVANT ADVERTISEMENTS”, filed on Dec. 6, 2002 and listing Jeffrey A. Dean, Georges R. Harik and Paul Buchheit as inventors; and Ser. No. 10/375,900 (incorporated by reference and referred to as “the '900 application”) titled “SERVING ADVERTISEMENTS BASED ON CONTENT,” filed on Feb. 26, 2003 and listing Darrell Anderson, Paul Buchheit, Alex Carobus, Claire Cui, Jeffrey A. Dean, Georges R. Harik, Deepak Jindal and Narayanan Shivakumar as inventors, describe methods and apparatus for serving ads relevant to the content of a document, such as a Web page for example. Content-relevant advertising, such as the AdSense advertising system by Google, have been used to serve ads on Web pages.
In any advertising system, it is assumed that advertisers mainly want sales (which is a specific type of conversion). Although there are also advertisers who want exposure (branding), the present inventors believe that sales is the main motivation for most advertisers. In an advertising system in which an advertiser pays only when its ad is selected, assuming that an advertiser is rational, its maximum offer per selection will be its expected profit from the selection. The problem is that different ad systems provide different conversion rates (e.g., sales per selection). Moreover, ad serving systems which use targeting techniques that let more ads compete for serving on a given document (e.g., due to broad matching permitted for targeting) may impose higher prices (e.g., cost per selection) on advertisers, while at the same time possibly having a lower value per selection. Thus, although such systems may provide useful ways to advertise, advertisers may nonetheless avoid them in favor of ad serving systems having providing a higher value per selection, and/or a lower cost per selection.
Even within a content-relevant ad system, conversion rates often vary across different publishers and different Web pages. This complicates ad campaign management.
One way to address this problem is to provide a pay-per-conversion scheme. Unfortunately, pay-per-conversion is not popular at this time for a number of reasons. For example, many small advertisers don't have the technical sophistication needed to establish and manage a pay-per-conversion ad campaign. Further, many large advertisers don't trust outside parties, such as advertising systems, with their sales data.
Another way to address this problem—at least in the context of a content-relevant ad serving system—is to allow advertisers to make different offers for different publishers or Web pages. Unfortunately, separate bidding per publisher is impractical for most advertisers.
Finally, one way to address the problem of different conversion rates for different ad systems (such as a query keyword-relevant ad system and a content-relevant ad system) is to permit advertisers to make different offers for the different ad systems. For example, Overture of Pasadena, Calif., permits separate bidding for content ads and search ads. Unfortunately, however, this doubles the number of ad campaigns that an advertiser will need to manage. Moreover, this solution does not address the fact that there may be quite a bit of variation in conversion rates among the various content publishers and among the various search publishers.
The fact that different publishers or Web pages have different conversion rates also raises an additional problem. Specifically, publishers with good conversion rates may end up subsidizing publishers with poor conversion rates in systems in which advertisers enter one offer across all publishers. Publisher subsidies are undesirable because they punish publishers with good conversion rates and reward publishers with bad conversion rates. Over time, a content-relevant ad network that subsidizes bad publishers at the expense of good publishers will attract more publishers with bad conversion rates. This may cause advertisers to lower overall maximum offers per selection over time.
In view of the foregoing, it would be useful to help advertisers to manage an ad campaign across different systems having different conversion rates, or event within a given ad system, such as a content-relevant ad system in which different publishers or Web pages have different conversion rates. More generally, it would be useful to simplify ad campaign management, while automatically adjusting (e.g., reducing) costs for an action (e.g., an impression, a selection, etc.) using factors that may affect a value of the action.
It would also be useful to reduce or eliminate publisher subsidies in a content-relevant ad system.